The Peak, a specialized foster care agency in Roswell, received a referral from the New Mexico Children, Youth and Families Department late last year. A teenage girl who had shot and killed her father needed a foster home.
Clinical staff at The Peak had a swift answer. They told CFYD that the child needs 24-hour supervision and care, and their foster homes are not equipped for the risk of such a dangerous, high-needs case. The Peak rejected the referral.
The Peak had received a referral about a month earlier, this time for a teenager who was housed in a psychiatric ward for extreme and aggressive sexual behaviors. The answer was similar.
The case was beyond the capacity of treatment foster care — a type of foster home specially trained and equipped for children who have experienced severe trauma and have especially high mental health needs — to handle, and placing her in one of the Peak’s homes would endanger both the child and her foster parents.
“These are just two examples of the types of referrals we receive on a constant basis that are not clinically appropriate” for treatment foster care, or TFC, Kevin Berry, The Peak’s executive and clinical director, wrote to legislators in November. “These are the children that are routinely staying in CYFD offices because TFC agencies say no.”
In recent years, the handful of these private, nonprofit TFC agencies operating in New Mexico have received hundreds of referrals for youth whose needs are too severe, directors say. The vast majority of those cases are rejected, with denial rates sometimes reaching as high as 89 percent, according to treatment foster care staff.
Some of the referrals are for kids who pose extreme risks to themselves or others, according to treatment foster care directors. Many more involve youth who have histories of property destruction or aggressive behaviors that require constant supervision and could jeopardize treatment foster care agencies’ liability insurance. Those include teenagers who had been living in CYFD office buildings because caseworkers could not find other placements for them, until an executive order from Gov. Michelle Lujan Grisham put an end to those office stays at the beginning of March.
“I’m not going to say all of them, but a lot of these kids that are bouncing around that were in the offices, are kids that need 24/7 supervision, and there’s just no place for them to go,” Berry said in an interview with Searchlight. “Some of these referrals aren’t clinically appropriate for any treatment foster care. And so we as treatment foster care agencies are constantly saying no.”
The denials pose a conundrum for CYFD. The agency is bound by the terms of the Kevin S agreement, a 2020 legal settlement mandating that CYFD and the New Mexico Health Care Authority house foster youth in home-based settings.
The state sees TFC as one of few options for kids who need more care than a traditional foster home can provide — and, notwithstanding the decisions of TFC providers, believes that is indeed appropriate for those kids.
In an email to Searchlight, CYFD communications director Jake Thompson said that all referrals to TFC are made after CYFD and managed care providers complete their own assessment and approve the child for a TFC level of care. The issue, he said, is that TFC agencies don’t have enough treatment foster families to meet the need.
“The issue isn’t that a child doesn’t meet the clinical need of the TFC, it is that the TFC agency doesn’t have a TFC family that matches to the clinical needs,” Thompson said.
It’s a difficult ask. Many of the teens who had been living in CYFD offices have spent years bouncing from one placement to another, without receiving the mental health care they needed. Their behavioral issues often escalate with each placement, driven by a constant lack of stability and repeated traumas they experienced in offices, youth homeless shelters and on the streets during runaway episodes. By the time their referrals reach treatment foster care, staff say, they need round-the-clock supervision and care.
But such care is almost nonexistent. Between 2019 and 2021, three New Mexico residential treatment centers closed under pressure from the state, following a string of high-profile cases of abuse in those treatment centers. Several others shut down on their own during the COVID pandemic, leaving only a smattering of 24-hour care facilities in the state. New Mexico does not have a single Qualified Residential Treatment Program, a type of short-term residential treatment encouraged by the federal government.
At the same time, the state’s obligations under the Kevin S. settlement include a drastic reduction of placements in residential treatment centers and other so-called “congregate care” settings, which have been shown to cause lasting harm to children.
Further complicating the problem is New Mexico’s lack of many of the ancillary “wraparound” services needed to help kids transition from hospital-level care to in-home foster care — mobile response and stabilization units, day treatment services, behavioral management services and other services are either completely unavailable or severely limited, according to a Sept. 2025 assessment. The gaps for those services are especially acute in rural areas.
With the system missing these vital components, referrals to the home-based foster care services that do exist are often unworkable, treatment foster care directors say.
“I’m not saying all these kids need to be in residential treatment centers,” Berry said. “But what we’ve done is we’ve gone from a system that actually had providers at each level of care to a system that has hardly anything. So there’s nowhere to send these kids.”
“I truly feel like we are kind of being boxed in,” he added. “If [CYFD] were to say, you can’t say no to these kids, I feel our only option to protect our parents would be to say, OK, then we’re done. Because we’re not going to jeopardize the safety of our parents or the kids that we’re already taking care of.”
The plaintiffs in the Kevin S settlement hope to solve this problem by building up wraparound services to a level that can keep kids from escalating to the point that they are unsafe for treatment foster families.
“Kids just do better in community-based care,” said Therese Yanan, a Kevin S plaintiff and the director of the Native American Disability Law Center. “There’s just no way to keep a kid safe in a congregate care setting. When push comes to shove, TFC was created to serve kids who previously would be placed long term in residential treatment centers.”
“The question we need to be asking isn’t ‘how can we force TFC providers to accept more kids,’” she said. “It’s ‘what does this specific child need, and how can we provide it in a home-based setting?’”
Since signing the Kevin S agreement in 2020, CYFD and the New Mexico Health Care Authority have tried, and failed, to build the infrastructure needed to fill the gaps left by the closure of the state’s residential treatment centers and to create a system of home-based care that can better meet the needs of the state’s youth.
Among the major reforms the state agreed to in 2020 was a goal of approving hundreds of new treatment foster care placements per year.
CYFD has not met that goal. In its 2024 annual report, the Kevin S monitors found that the state had made only 134 new treatment foster placements, 40 percent of its target of 319. Last year, CYFD placed about half the number of kids in treatment foster care than the Kevin S agreement called for — a gap due in no small part to the rejection of referrals by treatment foster care agencies over concerns about safety and clinical appropriateness.
But after six years of failures, a development this month has observers optimistic. On March 2, the Kevin S plaintiffs and the state entered into a new agreement meant to address several of the most pressing unresolved issues in the settlement, including the unworkable caseloads of CYFD workers, improving wellness checks for kids in foster care and the failure to match youth with treatment foster care homes. The state agreed to meet a new annual target of treatment foster placements by the end of this year. CYFD has yet to determine what that target will be.
There’s been some notable progress. In the first half of 2025, CYFD workers only met requirements for wellness checks 23 percent of the time. By the end of that year, workers completed them in nearly 80 percent of cases.
Kevin S plaintiffs are also hopeful that new leadership at CYFD will bring the department closer to meeting their commitments under the settlement. Notably, Brenda Donald, who joined CYFD as chief operating officer in January, was instrumental in ending a decades-old legal settlement in Washington, D.C., as director of the D.C. Child and Family Services Agency.
The decision to focus on treatment foster care referrals in the new order is “a real opportunity,” Yanan said. “Because, as you can see with the improvement in the well child checks, when something gets focused on, it can be addressed.”